Staff

Andrew Jackson

In September, 2012 he retired from a long career as Chief Economist and Director of Social and Economic Policy with the Canadian Labour Congress.

In 2011, he was awarded the Sefton Prize by the University of Toronto for his lifetime contributions to industrial relations. Educated at the University of British Columbia and the London School of Economics and Political Science, where he earned a B. Sc. and an M.Sc. in Economics, Andrew is the author of numerous articles and five books, including Work and Labour in Canada: Critical Issues, which is now in its second edition with Canadian Scholars Press.

Posts & Activities by Andrew Jackson

Two major recent studies – from Derek Burleton and his colleagues at Toronto-Dominion Bank, and from former senior federal government official Cliff Halliwell published by the Institute for Research on Public Policy – provide excellent overviews of recent developments in the Canadian job market, and an informed framework for thinking about our future skills needs.

This message seems to have finally got through to the Harper government. In a speech to the Vancouver Chamber of Commerce on November 14, Employment and Skills Development Minister Jason Kenney told employers to stop complaining and to stop relying excessively upon temporary workers. Instead, he said, employers should “put more skin in the game” by increasing wages in high-demand occupations and by investing more in the training of Canadians.

In 1939, the United States and much of the world were still struggling to exit the Great Depression that had begun a decade earlier. In that context, Alvin Hansen – the prominent economist and disciple of John Maynard Keynes – famously argued before the American Economic Association that the underlying problem was not cyclical, but rather “secular stagnation.”

Mr. Hansen anticipated an extended period of sluggish growth and high unemployment, due to a structural shortage of demand compared with already existing productive capacity. Under such circumstances, there were few profitable investment opportunities for business, resulting in excess savings and idle resources.

One of the major forces behind the rapid increase in the income share of the top 1% in the United States and Canada has been rising senior corporate executive pay, especially in the form of stock options.

The majority of the top 1%, and an even higher proportion of persons in the ultra-wealthy top 0.1%, are either senior managers of non financial companies or work in the financial sector where stock options are usually the biggest single part of total compensation.

The Oct. 19 Globe and Mail editorial supporting expansion of the Canada Pension Plan (CPP) got it exactly right. The CPP is “one of the country’s great public policy successes” and “the best [savings plan] we’ve got.”

Notwithstanding evidence that many middle-income earners will face a sharp decline in living standards in retirement as a result of the erosion of employer pension plans and very low rates of private savings, the Harper government has refused to endorse the emerging provincial government consensus in favour of CPP expansion. The main argument against seems to be that the required increase in contributions (about 3 per cent of earnings) would amount to a damaging tax increase.

On the one hand, the right celebrates private sector entrepreneurship and so-called free markets as the only sure road to prosperity. The private sector led “creative destruction” process is seen as the key source of capitalist dynamism and growth. On the other hand, progressives tend to stress the role of the state as a needed regulator of economic activity, as a Keynesian backstop to stable growth, and as a vehicle for achieving a fairer distribution of income and wealth. Proponents of a more active government role in the economy are often portrayed by the right as enemies of a successful economy.

During the last federal election, Stephen Harper promised that his Conservative government would introduce a new way to tax families with children after balancing the federal budget.

We are likely to hear a lot more about the merits of Harper's 'income-splitting' proposal before the 2015 election. The Conservatives continue to slash spending and erode public services precisely in order to create the fiscal room for this promised tax cut. Never mind that Mr. Harper’s aggressive agenda of tax cuts has already helped turn a $16 billion surplus in 2006 into annual deficits.

Not content with the recent Harper government decision to trim program costs by raising the age of eligibility for Old Age Security and the Guaranteed Income Supplement (OAS/GIS) from 65 to 67, the Fraser Institute wants to withdraw OAS benefits from more seniors.

They propose to claw back OAS benefits from seniors with individual incomes of more than $51,000, instead of the current clawback level of $71,000. Under their proposal, benefits would be entirely lost at an income of $95,000, instead of the current $115,000.

The high-profile Toronto Centre federal by-election features two well-known opposition candidates who agree that soaring income inequality, especially the fast-rising income share of the top 1% with all of its well-documented negative effects, is the defining political issue of our times. At issue is what we should be doing about it, through changes to public policy.

In thinking about this question, it is useful to distinguish between policies that affect the distribution of income by the market (called predistribution) and policies that make incomes after taxes and transfers more equal than market incomes (redistribution).

A new study by the Fraser Institute argues that introduction of anti-union “right to work” laws in Canada would boost manufacturing output and jobs. While they are right that these laws, which make dues payments voluntary, severely weaken unions, it is far from evident that unionization comes at the cost of poorer economic performance.

This is because collective bargaining has benefits for employers as well as for workers, and because collective bargaining outcomes reflect economic realities.

When the leaders of the world’s most powerful economies meet at the Group of 20 summit in St. Petersburg, Russia, on Wednesday and Thursday, they face an economic puzzle only half-solved. Co-ordinated monetary and fiscal stimulus by the G20 in 2008 and 2009 narrowly prevented a repeat of the Great Depression. However, almost five years after the onset of the global financial crisis, the world economy remains mired in slow growth and high unemployment.

As Coyne himself agrees, top incomes (incomes of the top 20%) rose much faster than those of middle and lower income groups for two of the last three decades. Things got worse over the 1980s and 1990s, and then there was a change, of sorts.

When it comes to food, drug and consumer-product safety, the storage and transportation of hazardous goods, and the control of pollutants that threaten human health and the environment, Canadians would almost universally agree that governments should regulate business to ensure that public health and safety always comes first. This is particularly true in the aftermath of preventable human tragedies such as that at Lac-Mégantic.

Detroit's recent bankruptcy filing led me to re-read a fine award-winning book by Thomas J. Sugrue, “The Origins of the Urban Crisis: Race and Inequality in Postwar Detroit.” The basic argument of the book is that the crisis of that city – now a mainly black, overwhelmingly poor city, a fraction of its former size and a shadow of its former magnificence – is deeply rooted in persistent discrimination against blacks at the workplace and in housing.

Employer groups such as the Canadian Chamber of Commerce and the Canadian Federation of Independent Business insist that their members need continued access to the Temporary Foreign Worker Program since Canada is experiencing an acute labour shortage, including a shortage of low-skilled workers.

That claim is highly dubious, and should be rejected by the federal government, which is now reviewing the program.

Last year there was a lot of discussion of Hanna Rosin’s best-selling book, The End of Men and the Rise of Women. The author was prominently interviewed in a Saturday issue of The Globe and Mail, prefaced by the words: “Women are ahead in academics. They’re jumping up the corporate ladder. And increasingly they’re the family breadwinners.”

Ms. Rosin’s basic thesis is that changes in the economy and the educational system play to the strengths of women, and that power is decisively shifting away from men in the job market. This, in turn, is profoundly changing traditional gender roles.

The Census — replaced by the National Household Survey in 2011 — is our key source of information for “visible minority” persons, best known as racialized persons (since race is a social rather than biological concept) and since “minorities” make up close to the majority of the population in the large urban centres of Toronto, Montreal, and Vancouver.

In 2011, one in five (19.1%) of all Canadians belonged to visible minority groups, up from one in six (16.2%) in 2006. Almost one quarter of young people age 20 to 24 belong to a visible minority group.

Harvard University economist Gregory Mankiw, Chairman of the Council of Economic Advisers under United States President George W. Bush and, more recently, a key economic adviser to Republican Presidential candidate Mitt Romney, mounts a spirited defence of the very rich in an article to be published in the next issue of the Journal of Economic Perspectives.

Mankiw’s central argument, recently highlighted by Chrystia Freeland, is that very high incomes reflect exceptional productive contributions by highly talented individuals which benefit the rest of society.

Ontario politics in the coming months are set to revolve around a debate on whether taxes should be raised to pay for a massive expansion of public transit and transportation infrastructure in the highly urbanized and acutely congested Greater Toronto and Hamilton Area (GTHA), home to about half of the province’s population.

Canada’s Economic Action Plan is being widely advertised this National Hockey League playoff season, but it is hardly working as advertised. It needs to be rethought in light of new thinking about the costs of austerity.

While the feel-good ads would have us think that the famous “Plan” is generating growth and jobs, last week’s Labour Force Survey showed that we have lost almost 100,000 paid jobs in the private sector since December.